The Pep Boys-Manny, Moe & Jack (NYSE: PBY) is being acquired. This should read “The long-lasting buyout rumors have finally come true” because this stock has been a rumored potential acquisition candidate for years. It has also been the subject of many rumors in that time.
The terms are as follows: The Gores Group will acquire all the outstanding common shares of Pep Boys for $15.00 per share in cash. This represents a premium of 24% percent over Pep Boys’ closing price of $12.08 on January 27, 2012 and a premium of 36% percent over Pep Boys’ volume weighted average closing price over the last 30 trading days.
The company’s board of directors has unanimously approved the merger agreement. It is further issuing the recommendation for existing shareholders to approve the transaction.
It is expected that Mike Odell, Pep Boys’ President & Chief Executive Officer and other members of the senior management team will continue in their roles with the Company after the completion of the transaction.
The $15.00 buyout compares to a 52-week range of $8.18 to $14.70.